Quick Take: Paytm - the operating leverage thesis continues to play out

Research evidence excerpt

Quick Take: Paytm - the operating leverage thesis continues to play out

21 July 2026

Pranav Gundlapalle

+91 226 842 1407

India Financials pranav.gundlapalle@bernsteinsg.com

One97 Communications Ltd Ishan Mittal

+91 226 842 1442

Rating ishan.mittal@bernsteinsg.com

Outperform Anirudh Gupta

Price Target +91 226 842 1456

anirudh.gupta@bernsteinsg.com

PAYTM.IN 1,500.00 INR

Quick Take: Paytm - the operating leverage thesis continues to

play out

Paytm reported a strong 1Q27 that supports our investment thesis of non-linear profit growth

Close Date 20 Jul 2026

driven by healthy revenue growth and significant operating leverage. Revenue grew 28% YoY

PAYTM.IN Close Price (INR) 1,347.50

while indirect expenses rose just 6% YoY, driving EBITDA growth of 182% YoY (nearly 10x

Price Target (INR) 1,500.00

YoY on a comparable basis excluding PIDF incentives) and EPS growth of ~80% YoY. The key

Upside/(Downside) 11%

positives were strong payment volume (GMV) growth, continued tight cost control, and robust

52-Week Range 1,407.00/930.60

growth in financial services. The key misses were stagnant marketing revenue and softer

ASIAX 1,866.01

payment monetisation, with net payment revenue growth lagging GMV growth.

FYE Mar

The hits Div Yield NA

Market Cap (INR) (M) 863,322

- Cost discipline continues. Indirect expenses grew just 6% YoY. The improved cost EV (INR) (M) 718,802

disclosures, including a 3% YoY decline in platform-building costs despite continued Performance YTD 1M 6M 12M

investments in AI and product development, provide greater confidence in the sustainability Absolute (%) 3.7 23.6 9.0 32.4

of this trend. ASIAX (%) 14.1 (8.9) 9.5 26.8

Relative (%) (10.4) 32.5 (0.5) 5.6

- Financial services remains the star performer.